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Tuesday, 13 September 2011

Government fiddling while house-buyers burn

Before the last election, National were going to “take aim” at house prices. They spent $10,000 on an overseas study on ways to “solve the problem.” National's housing spokesman, Phil Heatley, “went to the United States and UK to study ways of resolving the predicament of steeply rising house prices blocking many people from owning a home.” Heatley identified “tight land supply” as “one of the factors which had driven up prices,” and said he “favours re-zoning more rural land for urban development.” All good stuff.

Since then, we’ve had everyone from Canterbury to South Auckland still struggling to find serviced land on which to build a new house—and with tight land supply and rapidly increasing levies, charges and “contributions” forced on them by council, land developers have been unable to provide it.

8 comments:

Gareth Morgan's thesis is that we over invest in housing and hence do not have money for productive investment.

Nonsense. The reason we over invest in housing is because the land it sits on is hugely overpriced.The best way to reduce our investment in housing is to free up the supply of land and get rid of all the DURT. (Delays, Uncertainties, Regulations and Taxes).

If our houses were properly priced our banks would not have needed to borrow overseas to fund our mortgages. (I did the sums some years ago.)

" resolving the predicament of steeply rising house prices blocking many people from owning a home" ...is simple: earn more money

At present, presumably the situation for the average 'ordinary' person unable to afford a house goes something like this: you seek soft options in life; you earn a fixed salary: a fixed salary is a fixed salary is a fixed salary.

The price of a house increases (thank you John Key) and your salary remains ummmmm 'fixed' meaning you cannot afford to purchase that house; being a New Zealander you winge and moan and blame foreign ownership, Jewish banking conspiracies, Asian immigrants, rich people (or any one of 10089 other "enemies" real or imaginary) for that predicament.

The fairly obvious reason for being unable to afford the house - insufficient income - is entirely lost on you.

Equally lost on you is solving that predicament due to earning more money is lost on you.

Nothing will make home ownership more affordable than fellows stopping the tit sucking of either the State or employer and men of action and gumption stiking out on their own to earn a legitimate quid for themselves from their own efforts.

Anybody with even HALF a brain could sit down and fairly quickly think of 1009 different self employment activities which would earn them, say, $3000 per week.

Such an income would mean that home ownership became very affordable, very quickly.

Elijah is right, but our govt does all it can to stamp on entrepreneurship. I went to a seminar last night on Trusts, and the lawyer giving the presentation made the ridiculous statement "why should Sam morgan be able to make all those millions without getting taxed.." advocating for a capital gains tax. He then went on to say NZ needs more entrepreneurs like the Talleys, Coheys, Morgans etc, without a hint of recognition that his first statement is one of the reasons why the 2nd aren't as forthcoming. If this is the type of person who is advising our lawmakers, then its little wonder that tall-poppyism is being entrenched in our society.The Govt already rely on the top 8% of income earners to fund their extravagance, and now they want to punish the small proportion of that 8% that create the jobs for the rest of NZ's employed people, productive and non productive sectors included. The govt already wastes the income taxes, now you have supposed leaders advocating for the govt to waste capital too!

James, Elijah is correct you just have to decide what income and net worth you want, write it down and then start your head to thinking about how it can attain it. Then start your entrepeneurial education pathway by reading success stories, pathways and patterns for improvement.